THUMBS UP: Claim Tax Cuts Through Energy Efficiency

Physician's Money Digest, January 2007, Volume 14, Issue 1

Research Recommendations

According to a recently passed law,you have until January 1, 2008, to takea lifetime tax credit of up to $500 formaking your home more energy efficient.According to ,to qualify, your improvementsmust be installed in your primaryresidence and be reasonablyexpected to last at least 5 years. Bydoing so, you can be eligible for a taxcredit, which is an exact dollar reductionof your tax bill. The credit equals10% of the cost of energy improvementsto the "building envelope," and100% of residential energy propertyexpenses. These credits combined maynot exceed $500. Eligible improvementsfor the 10% building envelopecredit include insulation to reduce heatloss or gain, certain storm doors orwindows, and a metal roof with a coatingthat reduces heat gain. The 100%credit qualifications include $50 foreach advanced main air circulating fan,$150 for every natural gas, propane, oilfurnace, or hot water heater, and $300for each item of qualifying energy-efficientbuilding property (eg, heat pumps,air conditioners, etc). Speak with youraccountant before you embark on yourhome's energy-efficiency projects.